Conditions of tax audit

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2012 I'm an Individual & I trade in shares.I don't have any other source of income.In F.Y. 11-12 I sufferred a loss of Rs. 20,000 & a profit of Rs. 12,000.Can I show the above as my business income ???? If yes, am I required to get my books audited u/s 44AB because I am showing my business income below 8 % ?????

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2012 Are you in short term gain bracket OR speculative. Please ensure this.

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2012 It is short term

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2012 Then it is not business incme. so 44AD or tax audit is not applicable.

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2012 By mistake I have already shown this as my Business Income, then what ????

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2012 Either revise the return. 8% ceiling will not be applicable. Tax audit is also not applicable.

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2012 Why can't I show it as my business income as I am fully engaged in this ????

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2012 You can show. But lot of cases are pending in front of Assessing Officers on this account. Revenue earning nature of Income Tax is restricting the department from accepting the fact that it can be treated as business at the choice of ASSESSEE.

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2012 so what will be the implications???

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2012 Considering the amount involved in your example, nothing will happen. It will go un noticed.

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2012 in case in the Succeeding year my income crosses Crores and i continue showing it as my business income. then what?????

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2012 P Chidambaram would love to have this in crores... it will go for 30% slab. Best of luck.